US Fed Holds Interest Rate, Projects 50-Basis Point Interest Rate Cut In 2025—As It Happened
Catch all the updates on US Federal Reserve's decision on interest rates here.
US Federal Reserve Meeting Live: Key Takeaways From FOMC Interest Rate Decision
The Federal Open Market Committee kept the benchmark interest rate steady in the 4.25%-4.5% range.
The latest dot plot indicates policymakers still project two rate cuts in 2025, unchanged from December, with a half-percentage point reduction expected.
The statement now acknowledges increased uncertainty in the economic outlook, removing language that previously said risks to employment and inflation were “roughly in balance.”
The median Fed official raised the core inflation projection for 2025 to 2.8% from 2.5% in December, while the growth estimate was cut to 1.7% from 2.1%.
The Fed plans to slow the runoff of its securities holdings from April by reducing Treasury securities redemptions to $5 billion from $25 billion, while keeping agency debt and mortgage-backed securities redemptions at $35 billion.
Governor Christopher Waller dissented, favouring an unchanged pace of balance-sheet runoff. This marks his third dissent since the Fed started reducing rates in September, though he supported holding rates steady.
Source: Bloomberg
US Fed Meeting Live: S&P 500 Headed For Best Fed Day Since July 2022
The US equity benchmark S&P 500 is on track for its best performance since July 2022.
US Fed Meeting Live: Powell's Press Conference Ends
US Fed Meeting Live: Powell Declines To Comment On DOGE-Derived Savings
Powell declined to comment on fiscal matters when asked about potential for DOGE-derived savings being routed to households in check form.
Here are other highlights:
Powell did not provide a direct answer on whether the QT slowdown is permanent but indicated a shift in that direction.
On QT policy, Powell said, “We considered both pausing and slowing, and there was strong consensus in favour of slowing.”
Powell declined to comment on fiscal policy when asked about potential DOGE-derived savings being distributed to households.
Powell dismissed speculation that the Fed might halt MBS runoff, stating that the process will continue.
Sees no reason to expect a repeat of 1970s inflation.
Powell notes that inflation was around 2.5% before accounting for tariffs.
The Fed prioritises material and consistent shifts in financial conditions over stock market movements.
Powell declines to give an opinion on specific markets but reiterates that while soft data has weakened, hard data remains solid.
Powell confirms there are no plans to slow the Fed’s reduction of mortgage-backed securities.
Source: Bloomberg
US Fed Meeting Live: Powell Says Inflation Trend Is Moving In Right Direction
Here are the key highlights from Powell's statement:
Powell rejected the idea that long-term inflation expectations are rising.
Inflation is heading in the right direction and appears to be decoupled from tariff effects, a key topic of discussion.
There is no evidence that the slowdown in quantitative tightening signals a broader change in monetary policy.
The Federal Reserve is moving at a slower pace towards achieving an ample level of reserves.
While economic data remains strong, public sentiment is weaker, possibly due to price levels.
Inflation in the housing services sector has been performing well after being a concern for some time.
US Fed Meeting: Powell Dismisses Long-Term Inflation Concerns
Powell rejects the idea that long-term inflation expectations are rising.
Powell says inflation is moving in the right direction and appears to be less linked to tariffs, a key topic in recent discussions.
Source: Bloomberg
